Tuesday, June 3, 2014

Motor Insurance 101 - What is Excess?

There are two type of Excess in a Motor Policy. Excess simply means amount you have to pay when there is a claim.

1. Compulsory Excess
Compulsory Excess RM400 for Private Car policy, this is the amount of loss you have to bear if your vehicle is driven by a person not named in your policy or a person named in your policy who is under the age of 21 old the holder of a provisional (L) driving license or the holder of a full driving license of less than 2 years.  
2. Other Excess
Other Excess, this is the amount of loss you have to bear before we pay for the balance of your vehicle damage claim. This amount is determined by us based upon underwriting considerations. 

You can avoid the "Compulsory Excess" by ensure you have named your driver and avoiding "Other Excess" by buying only from company charging 0% excess instead of 0.5% or 1.0%.